Bush reaches out to factory sector

Proposal aimed at giving firms more policy input

By

CorbettB. Daly

WASHINGTON (CBS.MW) -- President Bush wants to give companies a greater say in how the federal government makes decisions that affect the struggling U.S. manufacturing sector.

Commerce Secretary Don Evans Friday released a report on the factory sector that seeks the establishment of a "President's Manufacturing Council." The body would "ensure a voice for manufacturers of all sizes in the ongoing implementation of the president's manufacturing initiative."

The 88-page report, long awaited by the manufacturing sector, is a key element of Bush's re-election strategy.

While the manufacturing sector comprises only 14 percent of the U.S. economy, a senior administration official stressed that it extends a "footprint" well beyond its initial reach.

"For every buck spent, there is another $1.43 in demand that manufacturing drives in the rest of the economy. It really has an impact much larger than the 14 percent," the official said.

The factory sector's political reach is substantial, and Democrats repeatedly charge Bush has not paid enough attention to the workers of the U.S. industrial producers.

"Under this administration, 2.6 million manufacturing jobs have been lost -- 8,000 of which came from my home state of South Dakota," Senate Minority Leader Tom Daschle, D-S.D., said in a speech at the National Press Club ahead of Bush's State of the Union next week.

In addition to the president's council, the report calls for making permanent recently enacted tax cuts and reducing regulatory burdens on manufacturers.

"This is our strategy to remove the barriers that are holding back American manufacturers and costing jobs," Evans said in speech in Cleveland.

And the former campaign manager named Grant Aldonas, Commerce Undersecretary for International Affairs, as the administration's interim official in charge of manufacturing while a prior proposal to create a lower- level Assistant Secretary of Commerce for Manufacturing and Services moves through Congress.

A senior administration official, speaking on condition of anonymity, said the manufacturing initiative is necessary because the factory sector has fallen on "hard times" in the past few years.

"The recession hit manufacturing much harder than it did the rest of the economy," the official said during a telephone conference call with reporters as the report was released.

"Productivity is key to raising to your standard of living and to a growing economy. And most of the productivity gains in our economy come out of innovation in the manufacturing sector," the official added.

At every turn, the president and his cabinet issue prepared statements underscoring their concern for the unemployed.

"Americans are confident, but we cannot be complacent -- President Bush will not rest until every American seeking work can find a job," Evans said in a written statement.

The top lobbyist for the nation's industrial producers, who pushed aggressively for the effort, praised the initiative.

"This is the first time in modern history that an administration has made manufacturing in America a top national priority," said Jerry Jasinowski, president of the National Association of Manufacturers.

Bob Baugh, executive director of the industrial union council at the AFL-CIO, the nation's largest labor union, said the proposal is just a re-packaging of earlier initiatives and did not offer anything new for the sector.

"This is a re-hash of many proposals that were floated six months ago," Baugh said, adding "it's packaging and (public relations) and build-up for the (Jan. 20) State of the Union and the campaign."

Still, after an outcry from the industry, the administration is now backing the Manufacturing Extension Partnership, an assistance program for the factory sector, which it had earlier sought to kill.

"I am more than willing to concede this is a turnaround from the point of view of the administration," the administration official said, while declining to say how much money Bush would seek for the program in his fiscal year 2005 budget proposal, to be released Feb. 2.

For the current fiscal year, the administration is seeking $39.6 million, less than half the roughly $100 million cost of the program in fiscal year 2003, which ended last Sept. 30.

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